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Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P.

Markwest Energy Partners, L.P. · Aug 22, 2012 · 32 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 1
    Investor Presentation Citi 2012 MLP/ Midstream Infrastructure Conference
  2. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 2
    Non-GAAP Measures Distributable Cash Flow, Adjusted EBITDA, and Net Operating Margin are not measures of performance calculated in accordance with GAAP, and should not be considered separately from or as a substitute for net income,…
  3. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 3
    Key Investment Considerations 0.80 0.70 Keystone Quarterly Distributions () 0.60 0.50 0.40 0.30 0.20 0.10 - High-Quality, Proven Track Record Substantial Diversified Assets of Growth and Strong…
  4. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 4
    Geographic Footprint SOUTHWEST NORTHEAST LIBERTY UTICA GULF COAST Granite Wash, Woodford, Cotton Huron/Berea Shale Marcellus Shale Utica Shale 140 MMcf/d cryogenic gas Valley, Travis Peak, Haynesville 505 MMcf/d processing capacity…
  5. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 5
    Growth Driven by Customer Satisfaction Ranked 1 in Midstream Customer Satisfaction Survey for 2011 Since 2006, we have been ranked 1 or 2 by EnergyPoint Research 6
  6. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 6
    US Shale Plays are Driving Natural Gas Supply MarkWest is focused on US Lower 48 Gas Production vs Demand Source EIA AEO 2012 midstream development in (Trillion Cubic Feet) resource plays (Woodford, 30 30 Granite Wash,…
  7. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 7
    Resource Play Economics Source: Company data and Credit Suisse estimates commodity pricing as of 7/16/12 8
  8. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 8
    Commitment to Resource Plays Capital investments and acquisitions in resource plays since 2006 3,000 Net Capital Expenditures 2,500 ( in millions) 2,000 1,500 1,000 500 0 Base Production (Conventional / Tight Sand)…
  9. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 9
    Contributions to Operating Income by Segment 2011 Segment Operating Income 2012 Forecasted Segment Operating Income 10% 54% 25% 11% 7% 45% 20% 29% Gulf Coast Southwest Northeast Liberty Gulf Coast Southwest Northeast Liberty…
  10. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 10
    Southwest Segment Competitive advantages Under Construction Rated 1st for midstream services in East Texas, 120 MMcf/d cryogenic processing capacity in E. Texas Midcontinent and Texas Intrastate by large customers Recently…
  11. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 11
    Gulf Coast Segment Competitive advantages Rated 1st in onshore Gulf Coast midstream services by large customers Provide high-quality processing and fractionation services to six major refining complexes Nearly 75% of our inlet…
  12. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 12
    Northeast Segment Competitive advantages Rated 1st for midstream services in the Appalachian Basin by all customers We are the largest gas processor and fractionator in the Appalachian Basin We have operated vertically integrated…
  13. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 13
    Liberty Segment Competitive advantages Rated 1st for midstream services in the Marcellus Shale We are the largest processor of natural gas in the Marcellus Shale with liquids-rich acreage dedications in excess of 400,000 acres…
  14. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 14
    Liberty Processing capacity of 2.5 Bcf/d and Fractionation capacity of 234,000 Bbl/d by the end of 2014 Hous ton Proce s s ing and Fractionation Com ple x Houston I - III 355 MMcf /d C3+ Fractionation 60,000 Bbl/d Interconnect to…
  15. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 15
    Utica Joint Venture Fractionation capacity of 100,000 Bbl/d and processing capacity of 430 MMcf/d by the end of 2014 Joint venture with The Energy & Minerals Group (EMG) to develop significant midstream infrastructure to serve…
  16. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 16
    Growth in Core Areas The Midstream Leader in Northeast Shales Customers include Range, EQT, Chesapeake, Antero, Statoil, Rex, Sumitomo, and others Keystone We are the largest processor in the Marcellus and Huron Shales We…
  17. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 17
    NGL Markets Total Production Forecast Forecast of US NGL Extraction from Gas Processing (1,000 BPD) 3,500 3,500 Forecast 3,000 3,000 2,500 2,500 Total NGLs Propane, Butanes, 2,000 Natural Gasoline 2,000 1,500 1,500 1,000…
  18. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 18
    Innovative Midstream Solutions Ethane pipeline projects in Marcellus will maximize producer economics Ethane demand is projected to increase by more than 40% over the next six years Image Source: BENTEK We are constructing…
  19. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 19
    US Propane Supply Forecast Forecast of US Propane Supplies (1000 BPD) 1400 Refining Propane Gas Processing Propane Imports 1200 1000 800 600 400 200 Emerging Resource Plays 0 Base Production (Conventional / Tight…
  20. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 20
    Northeast Propane Supply and Distribution Winter Propane Market vs We have invested significant capital Bbls/d MarkWest Production to develop a world-class processing, 120,000 Long Haul NGL fractionation, storage, and 100,000…
  21. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 21
    FINANCIAL OVERVIEW
  22. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 22
    2012 DCF and Capital Guidance 2012 DCF Forecast of 400 million to 440 million 2012 Capital Expenditures Forecast of 1.1 billion to 1.5 billion Liberty Utica * Liquids-rich gas gathering system 185 MMcf/d processing complex in…
  23. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 23
    Cost Equity of of Cost Capital Equity Capital 0% 2% 4% 6% 8% 10% 12% 14% ETP NKA KMP WPZ CMLP EROC XTEX NS Cost of Equity Capital GLP EEP BWP RGP NGLS EPB PNG Common Unit Yield TLP…
  24. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 24
    Strong Distribution Growth and Unit Performance 220% Distribution Growth since IPO in May 2002 (12% CAGR) 3.00 70.00 60.00 2.50 Unit () Unit () 50.00 2.00 per Common UnitUnit 40.00 1.50 Price per Common…
  25. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 25
    Risk Management Program Six months ended June 30, 2012 Six months ended June 30, 2012 Net Operating Margin by Contract Type Net Operating Margin Including Hedges Hedged Keep-Whole 38% 31% Fee-Based 44% Commodity Based 18%…
  26. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 26
    Increasing Fee-Based Net Operating Margin By 2014, total net operating margin is forecasted to be greater than 60% fee-based 70% 60% 50% 40% 30% 20% 10% 0% 2008YE 2009YE 2010YE 2011YE 2012F 2013F 2014F…
  27. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 27
    Keys to Success Maintain stronghold in key resource plays with high-quality assets Execute growth projects that are well diversified across the asset base Provide best-in-class midstream services for our producer customers…
  28. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 28
    APPENDIX
  29. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 29
    Reconciliation of DCF and Distribution Coverage Year ended Six months ended ( in millions) December 31, 2011 June 30, 2012 Net income 106.2 203.4 Depreciation, amortization, impairment, and other non-cash operating expenses 203.9…
  30. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 30
    Reconciliation of Adjusted EBITDA Year ended Six months ended ( in millions) December 31, 2011 June 30, 2012 Net income (loss) 106.3 203.4 Non-cash compensation expense 3.4 5.3 Non-cash derivative activity (0.3) (145.5)…
  31. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 31
    Reconciliation of Net Operating Margin Year ended Six months ended ( in millions) December 31, 2011 June 30, 2012 Income from operations 318.2 310.3 Facility expense 173.6 97.4 Derivative activity 75.5 (123.0) Revenue…
  32. Citi 2012 MLP Midstream Infrastructure Conference – Markwest Energy Partners, L.P. – slide 32
    1515 ARAPAHOE STREET TOWER 1, SUITE 1600 DENVER, COLORADO 80202 PHONE: 303-925-9200 INVESTOR RELATIONS: 866-858-0482 EMAIL: INVESTORRELATIONSMARKWEST.COM WEBSITE: WWW.MARKWEST.COM

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